Aiwara v Cocoa Board of PNG [2017] PGNC 128; N6788 (28 June 2017)

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TORT – breach of statute - trial on assessment of damages - judgment entered by default - cocoa farmer whose licences were cancelled - cocoa beans confiscated - claim for breach of sections 25, 26(4), 26(6)((b) and 28(1)(b) of the Cocoa Act Chapter No. 388 - general damages for loss of dignity and reputation and economic loss - loss of cocoa beans - punitive damage

The plaintiff was a cocoa farmer. He claimed that his cocoa licences were cancelled without any lawful basis contrary to statute. He said that at the time of the cancellation, the defendant also confiscated his cocoa beans without his authorisation. He said he suffered damages as a result and he has sought damages for breach of statute. Default judgment was entered against the defendant. This was a trial on assessment of damages.

PNGBC v. Jeff Tole (2002) SC694
MVIL v. Kauna Kiangua (2015) SC1479
Alex Awesa v. PNG Power Ltd (2016) N6359
MVIT v. James Pupune [1993] PNGLR 370
Sogeram Development Corporation Ltd v. Robin Som (2014) N5874
Keith Reid v. Murray Hallam and Allcad Pty Ltd (1995) N1337
Jack Pinda v. Sam Inguba (2012) SC1181
Jack Pinda v. Sam Inguba (2009) N4659
Coecon Limited -v- National Fisheries Authority & The State (2002) N2182
Firman Manua v. Southern Highlands Provincial Government (2008) N3505
Mathias Goma v. Protect Security and Communication Ltd (2013) SC1300
William Mel v. Coleman Pakalia (2005) SC790
Thomas Wapi v. Sergeant Koga Ialy (2014) SC 1370
MVIL v. Kauna Kiangua (2015) SC 1476
Toglai Apa v. The State [1995] PNGLR 43
Lucas Raika v, Peter Wama (1995) N137
Ernest Pokau v. Gordon Wettie (2010) N4086
James G Koimo v. The State [1995] PNGLR 535
Pius Pundi v. Chris Rupen (2013) N5306

1. ANIS AJ: This is a judgment on a trial for assessment of damages. I conducted the hearing on 24 and 26 May 2017. I then reserved my decision to a date to be advised.

3. The plaintiff is a cocoa farmer. He owns two blocks of land here in East New Britain Province where he grows and sells his cocoa produce. Back in 2002, he applied for and was granted three (3) licences, that is, to build a cocoa fermentary, to buy cocoa beans and to sell cocoa beans locally. The licences were renewable annually. On 13 April 2004, employees of the defendant attended the plaintiff's premises. They were there based upon a complaint they had received that the plaintiff was buying stolen cocoa beans after operating hours, that is, operating beyond 6 pm. The plaintiff was verbally advised that his licences were cancelled. The employees of the defendant who inspected the plaintiff's premises at that time confiscated cocoa beans that were kept at the plaintiff's premises.

4. The plaintiff says the defendant's actions or omissions at the material time were contrary to the Cocoa Act Chapter No. 388 (the Cocoa Act). He says as a direct result of that, he suffered damages.

5. On 5 December 2016, His Honour Justice Higgins granted default judgment in favour of the plaintiff with damages to be assessed.

6. The parties tendered their evidence without objections. They also waived their rights to cross-examine witnesses. I formally accepted and marked each of the evidence. Let me set them out here in a table format.

Exhibit No.	Description	Date filed
“P1”	Affidavit of Thomas Aiwara	02/11/10
“P2”	Affidavit of Thomas Aiwara	17/05/17
“P3”	Affidavit of John Tubangliu	11/05/17
“P4”	Affidavit of John Tubangliu	22/05/17
“P5”	Affidavit of Simeon Tausi Wakias	22/05/17
“P6”	Affidavit of Thomas Aiwara	18/04/17
“P7”	Affidavit of Thomas Aiwara	14/07/15
“P8”	Affidavit of Magdelyne Lakau	04/08/15
“P9”	Affidavit of Albert Kemi	04/08/15
“D1”	Affidavit of Tony Vigil	26/04/17

7. The first issue is whether the plaintiff had sufficiently pleaded the facts in his statement of claim, which would now support each of the relief that has been sought in the pleading. If so, whether the relief sought are available under the law, that is, based on the cause of action. The third issue is whether the plaintiff has proven his losses suffered. The fourth issue and subject to the first three (3) issues, is, how much should be awarded as damages for the losses that have been proven?

8. I refer to the relief. They are set out at paragraph 8 of the plaintiff's Statement of Claim (SoC). The plaintiff seeks as follows:

(iv) A Declaration that the verbal order for the cancellation of the Plaintiff’s licence is null and void, invalid and of no effect.

(v) An order that the Defendant restores the licences to the Plaintiff forthwith.

9. I note that the plaintiff has also claimed other damages in its submission during the trial. It is pointless to state them all here although I may briefly cover some in the course of my judgment. But let me say this. The pleading rules are clear in this jurisdiction. A party at trial cannot seek or argue matters or relief that the party has not pleaded in its statement of claim, cross-claim or defence. See cases: PNGBC v. Jeff Tole (2002) SC694; MVIL v. Kauna Kiangua (2015) SC1479; Alex Awesa v. PNG Power Ltd (2016) N6359; MVIT v. James Pupune [1993] PNGLR 370; Sogeram Development Corporation Ltd v. Robin Som (2014) N5874.

10. In the present case, default judgment has been entered with damages to be assessed. This was a trial on assessment of damages. A good case law that explains this type of hearing is the case of Keith Reid v. Murray Hallam and Allcad Pty Ltd (1995) N1337. The late Chief Justice Sir Mari Kapi as the then Deputy Chief Justice held and I quote:

What then is the effect of a default judgment? A writ of summons should disclose a cause of action in law. That is to say it should allege matters of fact which gives rise to a cause of action in law. In this case the statement of claim alleges a valid contract of employment, breach of that contract and claims damages based on the terms of the contract.

Where default judgment is entered in an unliquidated demand (as in this case) the facts which give rise to the question of liability are settled. The effect of default of judgment in this case is that there was a valid contract of employment and that there was a breach of that contract. All the facts and legal issues relating to liability are no longer in issue.

Assessment of damages involves consideration of the terms of the contract and assessing the damages that flow from the breach of the terms of the contract.

11. The plaintiff herein had alleged that the defendant's servants had attended his premises, had searched it, had taken away his cocoa beans and had verbally told him that his cocoa licences were cancelled because he had violated the terms and conditions of his cocoa licences. The plaintiff had denied violating the terms and conditions of the cocoa licences. The plaintiff had alleged that the actions of the defendant's employees and inspectors had breached the Cocoa Act generally and in particular sections 25, 26(b), 26(4) and 28(b). The plaintiff had further alleged that because of the actions and omissions of the employees of the defendant, he had suffered damages. See other illustrative cases on point: Jack Pinda v. Sam Inguba (2012) SC1181, Jack Pinda v. Sam Inguba (2009) N4659, Coecon Limited -v- National Fisheries Authority & The State (2002) N2182 and Firman Manua v. Southern Highlands Provincial Government (2008) N3505.

12. Based on those facts, default judgment was entered in his favour on 5 December 2016.

13. So what was the cause of action? In my opinion, the cause of action was under the common law, that is, based on the tort - breach of statute. The Supreme Court in the case Mathias Goma v. Protect Security and Communication Ltd (2013) SC1300 sets out the elements of the tort - breach of statute or statutory duty. They are and I quote:

(2) The elements of the tort of breach of statutory duty are that: (a) a statute imposed an obligation on the defendant; (b) the obligation was breached by the defendant; (c) the purpose of the statute was to protect a particular class of persons; (d) the plaintiff was a member of that class of persons; (e) the plaintiff suffered damage as a result of the breach; and (f) the Parliament intended to create a private right of action for breach of the statutory obligation.

14. For the present case, since default judgment has already been entered, it means the plaintiff is presumed to have established all six (6) elements of this tort. Before I go onto assessment of damages, I ask myself this. What does the law say on the role of a trial judge (or primary judge) when the trial judge is considering and assessing damages based on a judgment that has been entered by default?

15. To answer this question, let me refer to the Supreme Court case of William Mel v. Coleman Pakalia (2005) SC790. There, the Court sets out the role of a trial judge when dealing with assessment of damages. On point, the Supreme Court held and I quote:

Turning back to the issue raised above as to the role of the trial judge after entry of default judgment, we consider the following to be the correct approach:

16. The approaches are valid. I adopt them here. However, in regard to the third approach, I would comment that the Supreme Court perhaps did not elaborate with clarity. I ask myself this. How should a primary judge implement the third approach without breaching an earlier primary judge's ruling on liability, which has not been set aside? In my opinion, the Supreme Court in the next case that I refer to addresses this dilemma. I refer to the case of Thomas Wapi v. Sergeant Koga Ialy (2014) SC 1370 [see also other cases on point: Jack Pinda v. Sam Inguba and Anor (2009) N4659; Justice Longan's decision in MVIL v. Kauna Kiangua (2015) SC 1476 at paragraphs 105-114]. The Supreme Court in Thomas Wapi held and I quote:

10. If judgment, including a default judgment, has been entered in a proceeding, this constitutes a determination by the National Court on the question of liability. This determination should not be set aside unless a successful application for that purpose is made.

11. If another National Court dismisses a proceeding in which a default judgment has been entered, it is amongst others, setting aside the judgment and denying the plaintiff of its benefit. It is also, in effect, reviewing the decision to enter default judgment. In that regard we are reminded of the words of Kapi DCJ (as he then was) in Smith v. Ruma Constructions Ltd (2002) SC695 when His Honour, in considering an appeal against a decision to set aside a summary judgment said:

“The approach taken by the trial judge with respect is fundamentally wrong. In essence the learned trial judge reviewed the decision of Woods J. The trial judge had no jurisdiction to do this under an application to set aside judgment under O12 r8 of the Rules. This power belongs to the Supreme Court under the Supreme Court Act or s. 155 (2) (b) of the Constitution.”

12. Given the above, we are of the view that where a judgment, be it default or otherwise, has been entered, and a primary judge determines, after concluding a hearing to assess damages, that the plaintiff has not sufficiently proved his loss or that no cause of action is disclosed in the statement of claim or that the pleadings are defective or that the claim is frivolous or vexatious or is an abuse of process, he is entitled to refuse to make an award of damages. This is in accord with him being able to consider the question of liability for the damages claimed. To dismiss the entire proceeding however, in the absence of any application to set aside, as in this case, the effect of which is to review the decision to enter judgment and to set such judgment aside, is in our respectful view, to fall into error.

17. The said decision is binding and I also find it directly relevant for this purpose. In summary, I endorse the proposition that the National Court, in cases where it finds fatal errors in the pleadings or serious issues concerning liability, during assessment of damages hearing where default judgment has been entered, is entitled to refuse to make an award of damages without dismissing the proceeding.

18. The phrase "statutory damages" is inexact and inelegant. I adopted this quote off from the text Halsbury's Laws of England, 4^th Edition Volume 12. Let me quote in part from paragraph 1115 therein. It reads:

The phrase "statutory damages" is inexact and inelegant. However, damages may be associated with statutes in various ways.

Some statutes, for example the factories legislation, impose a duty the breach of which will give rise to a civil action by an individual suffering damage. The right has its origin in the statute, but the remedy is provided by the common law. In some cases, on a proper construction of the statute, no individual rights are given.

A statute may create a civil action for damages directly, and may define the criteria for the assessment of damages.

By statute, common law remedies may be excluded or limited, or a limit put on the damages recoverable.

Compensation provided by a statute should be distinguished from damages. So also should expenses made recoverable by statute. In this connection the distinction is relevant where one statute confers a right to recover expenses, and another limits liability in damages.

20. The plaintiff firstly claims general damages. This relief is general. It has a wide or broader perspective. In summary, the plaintiff is seeking pecuniary and non- pecuniary losses. To successfully seek various damages under the relief general damages, the plaintiff is required to sufficiently plead the various heads of damages and provide evidence to establish or justify his loses under each of the said heads of damages claimed.

21. In the present case, the plaintiff has pleaded the following heads of damages under general damage, namely, (i) damages for loss of dignity and reputation and (ii) economic loss.

22. Let me firstly consider damages for loss of dignity and reputation. The plaintiff argues that because the defendant cancelled his cocoa licences in breach of the Cocoa Act, he suffered damage to his dignity and reputation. The plaintiff cites breaches of sections 25, 26(4), 26(b) and 28(b) of the Cocoa Act. I note that section 25 is a provision that is not related to the pleaded facts in the SoC. It talks of Payment of bounty from Cocoa Stabilization Fund, which has no relevance to what had been pleaded in the SoC. It appears to be a clear typographical error intended it seems to refer to section 26. In any event, I refuse to make any award for breach of section 25 of the Cocoa Act. I also note that section 26(b) misses a subsection. It should read as section 26(6)(b). Also missing a subsection is section 28(b), that is, it should read as section 28(1)(b). I consider these minor errors because the plaintiff has provided sufficient particulars in the pleadings and in his submissions to clarify these provisions. I also note that the defendant did not contest them as issues at the trial.

23. Having clarified these let me now address the damage loss of dignity and reputation. I refer to the plaintiff's first citation of the breach, that is, breach of section 26(4) of the Cocoa Act. The section reads: The Board shall endorse on a Certificate of Registration a note of any conditions or restrictions to which the registration has been made subject under Subsection (2). The plaintiff pleads that, because there was no restriction imposed in his cocoa licences to buy cocoa beans after 6pm, for the defendant to say that there was such a restriction and to go ahead and cancel his cocoa licences, breaches section 26(4) of the Cocoa Act. In other words, the plaintiff says it was the duty of the defendant to inscribe the restriction namely to refrain from buying cocoa beans after 6pm into the cocoa licences at the time that it had issued the cocoa licences. And because the defendant had not done that, the plaintiff says that the defendant has breached section 26(4) of the Cocoa Act. I am satisfied that the pleadings are in order in regard to breach of the said provision. I am also satisfied that the facts in evidence support the pleadings in the SoC. I find that the plaintiff has breached section 26(4) of the Cocoa Act.

24. I refer to the plaintiff's second reference to breach of statute, that is, breach of section 26(6)(b). It reads and I quote:

(6) The Board may cancel a registration under Subsection (1) if it is satisfied that—

(b) the registered person, or in the case of registered premises, the owner or occupier of those premises—

(i) has failed, in the Board's opinion, to comply with a condition or to observe a restriction noted on the Certificate of Registration issued to him under Subsection (3); or

(iii) has not, in the Board's opinion, adequate finance, facilities or organization for the storage, control of quality, handling or marketing of cacao beans, cocoa beans or cocoa products, as the case may be.

25. The plaintiff says the defendant breached the said provision. He says when the defendant's employees had verbally told him on 13 April 2004 that his cocoa licences were cancelled, they had no authority to do so. The plaintiff says the Board, which is the defendant, is the only person that has that authority to cancel his cocoa licences but not until after the Board meets one or more of the three (3) conditions that are set out under section 26(6)((b) of the Cocoa Act. I am satisfied that the breach of the provision was properly pleaded with the backing of the facts in evidence. I find that the defendant has breached section 26(6)(b) of the Cocoa Act.

26. Thirdly, the plaintiff claims breach of section 28(1)(b) of the Cocoa Act. It reads and I quote:

(1) For the purposes of this Act, Cocoa Board Inspectors and Cocoa Inspectors may at all reasonable times, with or without assistants—

(b) seize and detain, pending an order of a court, cacao beans, cocoa beans or cocoa products in respect of which they have reasonable grounds for suspecting that an offence against this Act has been or is being committed; and

27. The plaintiff says the defendant breached section 28(1)(b). The plaintiff had pleaded denying that he had been buying stolen cocoa beans. He also had pleaded and as I have already found above that his cocoa licences did not have conditions preventing him from buying cocoa after 6pm each day. These two pleaded facts, were regarded as established upon the grant of default judgment. Therefore, the claim that the defendant breached section 28(1)(b) is upheld. I find therefore that the defendant had seized the plaintiff's cocoa beans without any basis under section 28(1)(b) of the Cocoa Act. I further find that even after when the plaintiff's cocoa beans had been confiscated, the plaintiff did not obtain any court order as required under section 28(1)(b). In conclusion, I find that the plaintiff has therefore breached section 28(1)(b) of the Cocoa Act.

28. In breaches of sections 26(4), 26(6)((b) and 28(1)(b) of the Cocoa Act as summarised above in my judgment, the plaintiff says his cocoa licences were cancelled. And he says that he suffered loss of dignity and reputation as a direct result. The plaintiff has provided evidence, which showed that he had been operating a fermentary as well as buying and selling cocoa beans under his cocoa licences for about two (2) years, that is, between 2002 to 2004. He said the cancellation of his cocoa licences has brought him shame and tarnished his dignity and reputation from within his community and in particular from his cocoa customers or sellers and buyers. He said after the incident, the community regarded him in a negative way as someone who had had his cocoa licences cancelled by the defendant for operating illegally or for breaching the law. Firstly, I ask myself this. Is the damage loss of dignity and reputation foreseeable? I would answer "yes". The plaintiff would obviously have suffered some form of humiliation, shame and disrepute to his name as a direct result of the actions and cancellation of his licences by the defendant and its employees. I find this to be the case here. It is quite difficult to put a monetary figure to the damages suffered by the plaintiff for loss of dignity and reputation. I am however not quite convinced that the plaintiff has disclosed sufficient evidence to show what sort of reputation he had before the incident on 13 April 2004. His best evidence, apart from his own, was from his eldest daughter and his former driver, that is, Exhibit P8 and Exhibit P9. I do not find the two (2) evidence useful for this purpose. There is no independent evidence from persons of higher standing or persons who could attest to the plaintiff status and name. That, in my opinion, would have assisted me well to compare and reach a reasonable figure.

29. Let me look at the case authorities. The first case I refer to is Toglai Apa v. The State [1995] PNGLR 43. Justice Sheehan, in a police raid case, made a global award under general damages (include aggravated damages) for suffering, shock, and insult to the dignity of an ordinary citizen, at K2,000 per plaintiff. The next case I refer to is Lucas Roika v Peter Wama (1995) N1373. The plaintiff was a politician. He sued the State for malicious prosecution. As for relief, he claimed K6,000 for his legal costs and an unspecified sum for damages to his name and reputation. Justice Woods awarded K9,000 in total to cover the two (2) relief. No apportionment was noted in the decision but it seems, in my view, that the additional K3,000 to the K6,000 would have been awarded for damages to his name and reputation.

30. I have given some thought and made comparisons. I have decided that for this case, I will award K5,000 to the plaintiff as damages for loss of dignity and reputation.

31. The next head of damage under general damage is damage for economic loss. Can that be sought for breach of statute I ask? That is, would that be a natural consequence or loss the plaintiff would suffer if the defendant breaches sections 26(4), 26(6)((b) and 28(1)(b) of the Cocoa Act and cancels his licences to trade cocoa? I would answer "yes" to the two (2) questions. The plaintiff's business at the time was buying, fermenting and selling cocoa under his cocoa licences. He could not trade after the defendant cancelled his cocoa licences.

32. The plaintiff has spent more time putting together evidence in regard to economic loss. Unfortunately, this is where I see and find that the plaintiff has with respect, failed in almost every aspect. I think the best place to begin is to read from paragraphs 12, 13 and 14 of the plaintiff's own affidavit namely Exhibit P2. This is where the plaintiff is responding to the affidavit of Tony Vigil, which is marked as Exhibit D1. The plaintiff says and I quote:

33. The deficiency in the plaintiff's evidence, in my opinion, is primary evidence [see case: Ernest Pokau v. Gordon Wettie (2010) N4086]. There were no primary records of his business or operations disclosed to the Court. The plaintiff does not disclose his bank statement. That in itself is hard for me to comprehend. Bank statements are easy to obtain and as such, I do not accept the plaintiff's excuses in his evidence. The plaintiff does not disclose any primary invoices, receipts of transactions to show his business operations particularly his weekly or monthly sales or takings. The plaintiff instead has himself as well as with the assistant of accountants drawn up income and expenditure statements for the years 2002 to 2004 at Annexure "C", "D" and "E" of Exhibit P1. The sheets and reports were prepared on 15 July 2009, which was about six (6) years later. Without the backing of primary evidence, I reject the evidence as good or credible to assess economic loss. I also reject Exhibit P3. I fail to see how the accountant John Tubangliu expects this Court to use his report when he has inserted a "Disclaimer" therein, which basically says amongst other things that the report is based on assumptions and not on original sourced materials or information.

34. Where can I find credible evidence to work towards assessing an amount under this head of damage? Annexure "B" to Exhibit P2 at first glance seems appropriate since the letter dated 18 January 2016 was said to be written by Boto Gaupu under the letterhead of the defendant. Based on the letter, it shows that in 2002 the plaintiff sold 251 cocoa bags. And in 2003, he sold 269 cocoa bags. It seems obvious that the plaintiff had used this letter to assist him create his various income and expenditure projections and estimates. However, upon a closer look, I find the letter suspicious and therefore unreliable. Let me explain. The attachment to the letter has no formal or print record for 2002 and 2003 productions of the total number of cocoa bags coming out of the plaintiff's fermentary as summarised at the cover page of the letter. The only formal record in the attachment concerns the plaintiff's four (4) bags of cocoa that had been confiscated by the defendant on 13 April 2004. However, on the same attachment sheet, there is hand written notes. It was said to have been written by Mr Gaupu. Mr Gaupu therein lists by handwriting the total production or number of cocoa bags for 2002 and 2003 for the plaintiff's fermentary. But as it can be clearly seen, Mr Gaupu's signature is different to his signature on the cover page of the letterhead. Secondly, he dates the attachment sheet after he is said to have signed, as 15 January 2007 whereas on the letterhead cover, the letter is dated 18 January 2006. The third thing I notice is that the two total figures appear similar. The plaintiff's total cocoa bags for 2002 was 251 or only 18 bags less than his total cocoa bags for 2003 which was 269. I can understand for the year 2003, which was a full year of production. But I am puzzled as to how the plaintiff was able to produce a similar quantity of cocoa bags for the year 2002 when he was granted the licences in September that year. He would only have had a few months left to buy and sell cocoa beans for the year 2002, which means he could not have produced a higher or similar number of cocoa bags like for the year 2003. I note that this evidence has not been subject to cross-examination. With these discrepancies, I will not regard to this evidence, that is, Annexure "B" to Exhibit P2 as good evidence. I also reject all of the plaintiff's evidence where he has used figures that were derived from the said letter.

35. Considering the rest of the evidence, I am particularly drawn to the evidence of payment for the four (4) cocoa bags that had been confiscated by the defendant on 13 April 2004. I refer to Annexure "A" to Exhibit D1. It is a copy of an invoice that was issued by Agmark Pacific Limited for the sale of the four (4) confiscated cocoa bags. The total sum made was K1,188.80 or K297.20 per bag. The invoice is the only primary evidence found in both parties' evidence. It is also the only original copy of receipt of payment of dry cocoa bags coming out of the plaintiff's fermentary. Let me remind myself that despite the plaintiff's claim that he has successfully operated his cocoa business for the past two (2) years, he has produced "zero" evidence of a single invoice showing his dealings over the said years. I am therefore convinced that I should use the figures that are provided in the Agmark invoice dated 13 April 2004, to assess the quantum for economic loss. So as at 13 April 2004, the plaintiff produced four (4) cocoa bags. I will assume that the plaintiff produces four (4) bags of dry cocoa beans per week. I note that cocoa licences are issued annually and they expire at the end of September of each year. The plaintiff makes no submission on this point, that is, the period in which loss is to be assessed on. I accept the defendant's submission that calculation should be limited to the period of the cocoa licences.

36. Let me calculate. I multiply K297.20 by four (4) cocoa bags. This will give me K1,188,80. As stated above in my judgment, I will assume for this purpose that the plaintiff sells four (4) dried cocoa bags per week. I will also assume for this purpose that three (3) weeks equals a month. I multiply K1,188.80 by three (3) weeks. I get K3,566.40 per month. I multiply K3,566.40, which is the value of the four (4) cocoa bags per month by five (5) months, estimated from April 2004 to September 2004, and I get K17,832. I minus 10% off from K17,832 to allow for contingencies. I am left with a sum of K16,048.80.

37. I will award K16,048.80 to the plaintiff as damages for economic loss. I am not convinced and will not award any sums for future economic loss. I note that the plaintiff has not made any submissions on this. I also find that damage to be too remote to predict or assess given the circumstances of the case.

38. I suspect the plaintiff's claim for loss of PMV business or profits is aimed to also come under the head of damage for economic loss under General Damages. I reject the claim for this damage because the relief is not pleaded in the SoC. Secondly, it is too remote to be regarded as a damage under general damages. I find that it is not foreseeable for the defendant to expect that the plaintiff would suffer loss to his PVM business if it cancels the plaintiff's cocoa licences. The cocoa licences were issued by the defendant to the plaintiff specifically to permit the plaintiff to engage in the cocoa business, and nothing else including operating a PMV business.

40. This relief is pleaded in the SoC. I am satisfied that the facts were sufficiently pleaded. With this assessment hearing, I am also satisfied that the evidence supporting them have been provided by the plaintiff. The evidence of the material facts, all of which have not been denied, indicates that the defendant and its employees were careless or reckless at the material time. The defendant's employees with policemen fronted up at the plaintiff's premises. And after they had ransacked his premises, they verbally told him that his cocoa licences were cancelled. Verbally notifying a cocoa licence holder during an inspection that his cocoa licences were cancelled does not constitute one of the prescribed methods for cancelling a cocoa licence as stipulated under section 26(6)(b) of the Cocoa Act. Only the defendant has that power to cancel a cocoa licence, not its inspectors. In my opinion, such action is wrong and must be deterred. An award of punitive or exemplary damages is warranted or should be granted, as a warning as well as to punish the defendant (see case: James G Koimo v. The State [1995] PNGLR 535) for the actions of its employees.

41. The cocoa industry is an important export earner for Papua New Guinea. I would imagine that small holders or cocoa growers like the plaintiff provide the bulk of the cocoa production for export. The commodity is regulated by the Cocoa Act and its regulations. The defendant is established under the Cocoa Act as a vehicle or regulator for the cocoa industry in the country.

42. The plaintiff appears to be a small time cocoa farmer here in East New Britain Province. He had been operating as a local cocoa dealer for two (2) years between 2002 and 2004. He has families and loved ones that he looks after. He would also have had obligations or commitments to meet at the material time. His cocoa trading business was his means of earnings. One day and without any warning, his cocoa licences were suddenly taken away from him just like that. And after that, there is evidence which shows a trail of follow-ups, inquiries, correspondences by the plaintiff who had tried his best to restore his licences but to no avail. Let me refer to Annexure "R" to Exhibit P1. The plaintiff attaches a Special Brief report, which is dated 25 September 2006. The report was prepared to the attention of the defendant's Chief Executive Officer by one Paul Joshua Messach who held himself out as 'Director of Growers Representative' of the defendant. The report had amongst other things, recommended reinstatement of the plaintiff's licences. It appears that the defendant had ignored the recommendation. The defendant did not challenge this evidence. In my opinion, evidence such as this together with what I have found above in my judgment, shows or warrants that this Court should impose some form of punishment against the defendant to set a precedent that such mal practises by the defendant or its employees must not be tolerated or repeated in the future.

43. I note that what the plaintiff is seeking, that is, K1,000,000 is too high. I will award a sum of K5,000 for exemplary damages. I think this sum is reasonable as a start. If such conduct by the defendant is repeated in the future then the National Court, in my opinion, would have to start considering higher awards for exemplary damage.

44. The plaintiff seeks as a separate relief reimbursement of the value of his cocoa beans that had been taken away from his premises on 13 April 2004. He seeks in total a sum of K8,000.

45. The plaintiff says the sum represents the value of both wet and dry cocoa beans. At the trial, I asked the plaintiff's counsel to show evidence of the value and quantity of the wet and dry cocoa beans. Counsel was unable to assist. But when I look at the evidence, I see evidence provided. Firstly, as far as dry cocoa beans are concerned, I note that I made findings on them above in regard to economic loss. Again, without any independent, good or realistic evidence disclosed by the plaintiff, I will accept that four (4) bags of dry cocoa had been confiscated based on the original receipt of the said cocoa sales that is attached as Annexure "A" to Exhibit D1. I will not accept estimates or vague figures cited by the plaintiff in his affidavits that are primarily based on his cash flow projections that do not have any primary documentation supporting them.

46. I will award K1,188.80 to be paid by the defendant for his lost dry cocoa bags.

47. In regard to the value of confiscated wet cocoa beans, let me see the evidence. I refer to Exhibit P2. At paragraphs 5, 8 and 9, the plaintiff says he had six (6) boxes of wet cocoa beans that were worth about K8,000. Except for one invoice, which is attached therein, I reject the plaintiff's evidence on this subject matter. Annexure "A" to Exhibit P2 consists of his hand written lists. Looking at them, it is, in my opinion, any body's guess as to where these lists may have been extracted from. The total calculations of wet cocoa beans sold therein exceeds K9,000 as opposed to what the plaintiff has stated in his affidavit.

48. Referring back to the invoice referred under Annexure "A" to Exhibit P2, let me discuss it. The invoice again is a copy of receipt of payment of the wet beans that had been confiscated from the plaintiff's cocoa fermentary. It is dated 13 April 2004. The total weight of the wet cocoa beans therein was 475kg. That would be about 12 bags if they were weighed at 40kg per bag. The sale was based on the rate K1.20 per kilo. The total payment received by the defendant was K570, which is consistent with the rate charged at that time. The said invoice is also attached to the defendant's evidence, that is, at the last page of Annexure "A" to Exhibit D1.

49. For purposes of calculating the total value of the wet cocoa beans that had been confiscated, I accept the sum K570 as the correct total value. I will add this to the value of the dry cocoa beans which is K1,188.80 and get K1,758.80.

(v) An order that the Defendant restores the licences to the Plaintiff forthwith.

51. Relief (v) is of course consequential to relief (iv), which is why I have put them down together under this sub-heading.

52. A declaration is an equitable relief. I have the discretion to either grant or refuse to grant this relief. The late Justice Davani in the case Pius Pundi v. Chris Rupen (2013) N5306 explains the relief and the Court's power. Her Honour held (basing her judgment on the Halsburys Laws of England, 4th Edition Volume 1(1) at par. 165) and I quote:

In both judicial review proceedings and in an ordinary action, the power to make a declaratory judgment is discretionary. The discretion should be exercised with due care and caution and judicially with regard to all the circumstances of the case, and, except in special circumstances, should not be exercised unless parties interested are before the Court. It will not be exercised where the relief claimed would be unlawful or unconstitutional or inequitable for the Court to grant or contrary to the accepted principles upon which the Court exercises its jurisdiction. The Court will not make a declaratory judgment where the questions raised is truly academic or the declaration would be useless or embarrassing or where an adequate, alternative remedy is available such as an action for damages.

53. I note that the defendant's counsel submitted during the trial that the Court cannot grant a declaration in this instance. Counsel said the relief has not been proven and the only way to do so would be through a proper hearing. Counsel said since the plaintiff did not address that earlier during the default judgment hearing, it is too late now to consider this relief. I note that I had asked counsel to provide case law to support his submissions. Counsel had under-took to address that in the defendant's submission. However, when I look at the defendant's written submission, I cannot see any case law or submission on this point. I therefore find the submissions on point by the defendant baseless.

54. I will grant the declaratory order that is sought under relief (iv) in the SoC. I note that I have already found above in my judgment that the employees of the defendant did not have any powers under the Cocoa Act to verbally cancel the plaintiff's cocoa licences. The process for cancellation is set out under section 26(6)(b) of the Cocoa Act. I have found that the defendant has breached the said provision. Therefore, if I am asked, whether this Court can declare that the verbal order for the cancellation of the Plaintiff’s licence is null and void, invalid and of no effect, I would say "yes" because the plaintiff has already established that.

55. That said, I move on and ask myself this. Can I also grant the consequential order sought under relief (v) in the SoC? I would answer "no" to the question. The reason, in my view, is simple. The plaintiff's cocoa licences that were cancelled were renewed annually under the Cocoa Act. As such, they would have expired on 30 September 2004. Relief (v) requests this Court to order the defendant to restore the licences to the Plaintiff forthwith. That is not possible because the licences would have expired on 30 September 2004. Secondly, the Cocoa Act sets strict conditions that have to be met before an applicant may be granted with a cocoa licence. It would be an abuse, in my opinion, to grant orders that would effectively bypass the processes that are provided under the Cocoa Act. If the plaintiff wishes to obtain his licences, he should apply like the other cocoa farmers, to the defendant with the required prerequisites.

56. I instead propose to and I will issue a consequential order that will say that the plaintiff may apply to the defendant for issuance of new cocoa licences or for renewals.

57. The plaintiff has asked for interest at 8% per annum. Grant of interest is discretionary. The applicable Act now is the Judicial Proceedings (Interest on Debts and Damages) Act 2015. Except for interest rate against the State, which is fixed at 2% or less per annum, the Court's power to determine an appropriate interest rate is discretionary. Sections 4(1) and 6(1) state and I quote:

(1) Subject to Section 5, in proceedings in a court for the recovery of a debt or damages, the court may order a rate as it thinks proper to be applied to the sum for which judgment is given interest, on the whole or part of the debt or damages for the whole or part of the period between the date on which the cause of action arose and the date of the judgment.

(1) Subject to Subsections (2) and (3), where judgment is given or an order is made for the payment of money, interest shall, unless the court otherwise orders, be payable at the prescribed rate from the date when the judgment or order takes effect on such of the money as is, from time to time, unpaid.

58. I have said above that the plaintiff has sought interest at 8% per annum. That is also sought in the SoC. The defendant does not make submissions on this point. I will award interest using the said 8% per annum interest rate.

59. Having determined the rate, let me calculate interest on the various damages that I have found where it applies. For general damages, the total sum awarded is K21,048.80. Eight (8) percent per annum of K21,048.80 is K1,683.90. I divide K1,683.90 by 365 days and get K4.61, which is interest per day accruing from the sum K21,048.80. To assess the pre-judgment interest, I will start from the date of filing of the Court proceeding to the date of judgment. The SoC was filed on 20 July 2006. The date of judgment is 28 June 2017. So from 20 July 2006 to 20 July 2016 is a total of ten (10) years. As such, I multiply K1,683.90 by 10 years and get K16,839. I will assume for this purpose 30 days as equivalent to one (1) month. As such, I note that from 20 July 2016 to 20 June 2017 is a total of 11 months. So I multiply K4.61 by 30 days and by 11 month and I get K1,521.30. From 20 June 2017 to 28 June 2017 is a total of eight (8) days so I multiply K4.61 by eight (8) days and I get K36.88. In total, I add all the calculated interests with the sum K21,048.80 and get K39,445.98.

60. The other relief requiring assessment of its interest is the total reimbursement sum of K1,758.80. I will use the same method and assumptions as I have done above. Eight (8) percent of K1,758.80 is K95.10. The sum K95.10 is the accrued interest per year for the sum K1,758.80. I divide K95.10 by 365 days and get K0.26, which is interest per day accruing from the sum K1,758.80. To assess the pre-judgment interest, I will start from the date of filing the Court proceeding to the date of judgment. The SoC was filed on 20 July 2006. The date of judgment is 28 June 2017. So from 20 July 2006 to 20 July 2016 is a total of ten (10) years. As such, I multiply K95.10 by 10 years and get K951. I will assume for this purpose 30 days as equivalent to one (1) month. As such, I note that from 20 July 2016 to 20 June 2017 is a total of 11 months. So I multiply K0.26 by 30 days and by 11 month and I get K85.80. From 20 June 2017 to 28 June 2017 is a total of eight (8) days so I multiply K0.26 by eight (8) days and I get K1.56. In total, I add all the calculated interests with the sum K1,758.80 and get K2,797.16.

62. Cost is discretionary. I find that cost should follow the event. This means that I will award cost of the proceeding to the plaintiff, which will be assessed on a party/party basis to be taxed if not agreed.

1. The plaintiff is awarded K39,445.98 (inclusive of pre-judgment interest) as general damages for loss of dignity and reputation and for economic loss.

3. The plaintiff is awarded K2,797.16 as reimbursement for his confiscated cocoa beans (inclusive of pre-judgment interest).

4. Pursuant to Judicial Proceedings (Interest on Debts and Damages) Act 2015, post judgment interest shall apply to the total judgment sum of K47,243.14 at 8% per annum if the total judgment sum is not fully settled within 30 days from the date of entry of the order.

5. A Declaration that the verbal order for the cancellation of the plaintiff’s licences is null and void, invalid and of no effect.

6. The plaintiff is cleared and is at liberty to reapply or apply to the defendant for cocoa licence(s) to trade.

7. Cost of the proceeding is awarded to the plaintiff on a party/party basis, which may be taxed if not agreed.

8. Time of entry of the judgment is abridged to the date of settlement by the Registrar of the National Court which shall take place forthwith.

____________________________________________________________
NatPhil& Associates: Lawyers for the Plaintiff
Warner Shand Lawyers: Lawyers for the Defendant

National Court of Papua New Guinea

Aiwara v Cocoa Board of PNG [2017] PGNC 128; N6788 (28 June 2017)